How a Home Loan is Securitized | Flow Chart
What the chart doesn’t address is what happens to the mortgage. The mortgage was separated from the note and assigned to Mortgage Electronic Registration Systems, Inc. as part of the original mortgage document. Because the securitized loans would be bought and sold, the mortgages weren’t recorded in the public record where a new assignment would have to be recorded everytime the securitized note changed ownership. The mortgages were assigned to MERS, which was supposed to maintain records of who owned the mortgages. Recent information indicates MERS did not maintain a chain of title but only a record of the current owner, and in some cases has no record of the owner only the servicer.